Correlation Between Agilent Technologies and Frequency Therapeutics
Can any of the company-specific risk be diversified away by investing in both Agilent Technologies and Frequency Therapeutics at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Agilent Technologies and Frequency Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agilent Technologies and Frequency Therapeutics, you can compare the effects of market volatilities on Agilent Technologies and Frequency Therapeutics and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Agilent Technologies with a short position of Frequency Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilent Technologies and Frequency Therapeutics.
Diversification Opportunities for Agilent Technologies and Frequency Therapeutics
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Agilent and Frequency is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Agilent Technologies and Frequency Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Frequency Therapeutics and Agilent Technologies is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Agilent Technologies are associated (or correlated) with Frequency Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Frequency Therapeutics has no effect on the direction of Agilent Technologies i.e., Agilent Technologies and Frequency Therapeutics go up and down completely randomly.
Pair Corralation between Agilent Technologies and Frequency Therapeutics
Taking into account the 90-day investment horizon Agilent Technologies is expected to generate 7.96 times less return on investment than Frequency Therapeutics. But when comparing it to its historical volatility, Agilent Technologies is 6.44 times less risky than Frequency Therapeutics. It trades about 0.04 of its potential returns per unit of risk. Frequency Therapeutics is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 5,048 in Frequency Therapeutics on August 30, 2024 and sell it today you would earn a total of 451.00 from holding Frequency Therapeutics or generate 8.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agilent Technologies vs. Frequency Therapeutics
Performance |
| Timeline |
| Agilent Technologies |
| Frequency Therapeutics |
Agilent Technologies and Frequency Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agilent Technologies and Frequency Therapeutics
The main advantage of trading using opposite Agilent Technologies and Frequency Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilent Technologies position performs unexpectedly, Frequency Therapeutics can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Frequency Therapeutics will offset losses from the drop in Frequency Therapeutics' long position.| Agilent Technologies vs. Danaher | Agilent Technologies vs. Illumina | Agilent Technologies vs. IDEXX Laboratories | Agilent Technologies vs. Waters |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |